Is Guild Wars 2 Going to Take Down World of Warcraft And Activision?

We've little doubt that Guild Wars 2 is going to be an amazing and successful game. It looks great and we can't wait to play it this August.

On the other hand, it's easy to let excitement run away with you. Forbes just today has run a piece by two financial analysts who insists that Guild Wars 2 is about to spell real trouble for Activision as a company.

We're just a little skeptical.

The crux of the argument by Leonid Levit and Derek Cheung of Honne Capital can be broken down into three bullet points, really:

– Guild Wars 2 is about to happen to WoW, so you should totally sell your Activision stock now before Vivendi just dumps its 60% share on the open market.

Of course, this entire argument works on two unquestioned assertions. The first is that World of Warcraft fans will all cancel their subscriptions and just play Guild Wars 2 exclusively, instead of playing both. The second is that World of Warcraft's coming September expansion isn't going to sell a lot of copies.

It's true that WoW is potentially a weak point for the company. Losing a million subscribers didn't do wonders for Activision's bottom line this quarter. And that's undeniably a troubling number. But what Cheung and Levit are predicting is several million subscribers jumping ship come August 28th.

Secondly, at no point in their analysis do the words "mists" or "Pandaria" appear. Anticipation is extremely high for the expansion, and new expansions tend to drive up subscriber numbers even if only temporarily.

Thirdly, it would take a lot for Vivendi to just dump its stock on the open market. It's true it's been having trouble finding a buyer but Activision is still a profitable company. It's far more likely that Activision will simply buy back the stock and become independent.

In short, we think there's plenty of room for both games to thrive. And that's a good thing for everybody.